Property taxes shift from big payers to small ones in Carbon
State cuts tax valuations of some major corporations, other payers take on burden
People who have noticed an increase in their home property tax bills may have wondered how this could have happened without hearing any word of a tax increase from schools or local governments.
The answer is simple on the surface, but far more complex the deeper one looks.
Basically, taxpayers whose property is assessed locally have been making up for a significant drop in the taxable values of those who are assessed by the state.
Significant means a $475 million drop in the State Tax Commission's taxable valuation of the county's top ten taxpayers since 2008.
According to figures provided by the County Treasurer, the top ten were valued at $1.36 billion in 2008, and $888 million in 2011. The tax amount was $12 million in 2008 versus $10.17 million in 2011.
There are a few different companies on the 2008 and 2011 lists, but all are involved in the utility, rail transportation and energy production sectors.
Without singling out any particular company, the drop in overall county taxable value went from roughly $2.3 billion in 2008 to $1.9 billion in 2011.
Nevertheless, the county's property taxing entities have gotten by. Total charged taxes in 2008 were about $21.4 million and $21.8 million last year, an increase of slightly less than 2 percent.
That's possible because, as County Commission Mike Milovich explained it, "The loss (in state assessed value) has been passed on to you and me. There's a shifting in the tax burden."
County Clerk/Auditor Robert Pero said that the county is allowed to collect an amount each year equal to the previous year plus any additional revenue that can be attributed to growth in the tax base.
By staying within its certified tax rate, the county can adjust, which it has done.
Commissioner John Jones, who has been named chair of the Utah Association of Counties new Centrally Assessed Property Committee, said that the ability to adjust for changing valuations gives local governments a measure of stability. That's especially important to bond holders and potential buyers, he added.
Both commissioners and the the clerk/auditor all used the word "complicated" to describe the state's method of setting values.
The Sun Advocate verified that by visiting the state website outlining the methodology: it includes such things as corporate capital structure, risk premiums inferred from market prices of stocks and bonds and other measures beyond the time and space of this newspaper can commit.
Basically, however, the underlying theme is that the value of industrial property is not the same as the value of a home simply because that sort of property is used to make money, not to live in.
If real or projected revenue goes up or down for any reason, the value of the asset follows. Assets also depreciate and deplete over time.
Jones said he is still getting up to speed on the issues of centrally assessed properties and will have more to say as he does more research.
Milovich, meanwhile, stated that from the perspective of local governments, the state's handling of the central assessments has been "less than favorable."